As the world shifts to cleaner sources of energy, electricity generation is becoming increasingly distributed, in response to the geographically dispersed nature of the available clean resources. Also, large-scale electric storage capability will be needed, due to the varying availability of natural energy sources.
The function of an electrical power grid is to transmit electrical power from its sources to its loads. Its origins date to the 1880s when Thomas Edison established the first direct current (DC) distribution grid, which was soon replaced by Tesla's alternating current (AC) grid. AC transmission won out because of the ease of increasing AC voltage with low-frequency transformers for long-distance transmission, and subsequently transforming back to lower voltage at the point of use. The existing AC infrastructure (“the grid”) works well for large centralized power plants with distributed loads, but is not well-suited to support distributed power production or electrical energy storage. Among other limitations, the existing AC grid has no built-in provisions for communication, for instance to communicate the real-time availability of energy relative to demand.
Advances in power electronics are enabling efficient and inexpensive DC power conversion, while rising materials prices (notably copper) add to the cost of conventional AC power conversion. This is especially true in the case of distributed sources such as solar, wind, and fuel cells, since these sources are either fundamentally DC in nature or must be converted to DC before they can be converted to grid-compatible AC. Most means of electrical storage are also fundamentally DC in nature, as are nearly all modern loads (with the exception of induction motors). The present requirement of converting the inputs/outputs of these devices to AC for interconnection reduces their efficiency and increases their costs.